Asa Award Winner Sees Resurgence of Privatization Efforts

Kennelly, Barbara B., Aging Today

At the Joint Conference of the American Society on Aging (ASA) and the National Council on Aging (NCOA) in Chicago in March, the ASA board of directors presented the 2007 ASA Award to Barbara B. Kennelly for her outstanding contributions to aging-related advocacy. Since 2002, Kennelly has been president and CEO of the National Committee to Preserve Social Security and Medicare (NCPSSM) in Washington, D.C., and served as an elected public official for 23 years, including 17 years in Congress as the United States Representative for the first district of Connecticut, including the Hartford area, from 1982 through 1999. Prior to taking the helm of NCPSSM, she served as counsel to the commissioner of Social Security. The following article is adapted from "The Politics of Social Security and Medicare Privatization" the awards address she gave at the ASA-NCOA Joint Conference.

As president of the National Committee to Preserve Social security and Medicare, I often speak about the threat posed by Social security privatization. Although many who oppose privatization of Social security may think this fight was won last year, the forces on the other side are still very much on the battlefield. As far as they're concerned, a single battle may have been lost, but the war itself is far from over.

In my view, that is one of the reasons we keep fighting the privatization battle over and over again. We declare victory and let down our guard while the other side merely regroups and attacks from another angle. Pro-privatization organizations have invested millions of dollars into their fight to unravel social institutions in this country. They may change their tactics and their message, but never their goals.

BUSH'S PLAN

The 2006 election weakened President Bush by removing the Congressional majorities that helped him advance his agenda for the past six years. But where Social security is concerned, there is clear evidence that the president remains a strong promoter of privatization.

For the third year in a row, the president's budget will allow workers under age 55 to divert up to 4% of their payroll taxes out of Social Security and into private accounts in 2008, thus undermining the Social Security system. To replace the diverted payroll taxes, he budgeted the $637 billion needed to pay current beneficiaries. This amount is meant to serve as a down payment to begin the process of privatization and renew President Bush's endorsement of price indexing, a new formula for calculating Social security payments-a formula that could decimate retirees' benefits in future years.

In a strategic move to build a strong pro-privatization team, the president nominated Andrew Biggs to be deputy commissioner of the Social security Administration. Biggs has a long history of antipathy toward the Social security program, to the point of calling it a "sacred cow" that should be "sent to the slaughterhouse." When his nomination foundered, the president simply appointed Biggs deputy commissioner of policy-a position not subject to Senate confirmation. In that position, Biggs will still be responsible for developing many of the policies advocated by the Social security Administration.

President Bush's emissaries, Treasury secretary Henry Paulson and Rob Portman, director of the Office of Management and Budget, have been highly visible on Capitol Hill as they have attempted to persuade the new Democratic majority to join with the president in negotiations on Social security. Their rhetoric of "no preconditions" for discussion has the sound of compromise in itbut their marching orders seem quite clear-they are to keep private accounts in the mix and make sure any solution does not include new revenues. What that leaves on the table are benefit cuts to make Social security solvent, then more benefit cuts to pay for private accounts.

WEAKENED FINANCES

It is easy to understand why we advocates are so adamantly opposed to private accounts. …

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